Solo 401k Plan Deadline for 2019 Tax Savings Are Fast Approaching

By Stuart Robertson

There is an important deadline for owner-only businesses that want to save on taxes this year and/or want to set money aside for retirement. Solo 401k plans, also called Individual 401k plans, enable owners to tax-defer up to $56,000 in taxes for 2019 or $62,000 if you are at least 50 years of age. This can be a significant tax savings for this year to the tune of $10,000 or more for some.

Purchase a Plan by 12/30 to Have Until Your 4/15 Tax Deadline to Save on 2019 Taxes

Solo 401ks, which are for the self-employed or any multiple owner business that does not have any employees, must be setup by December 31, 2019 to receive tax benefits. The good news is that you’ll have until your tax filing deadline (April 15, 2020 for most business types) to make profit sharing contributions into your 401(k) and still receive the tax benefits for 2019.

You can purchase and complete the online setup by December 30th and still qualify. If you buy by December 20th you can take advantage of ShareBuilder 401k’s free setup promotion.

You’ll Have Access to Roth 401(k) and Loan Options Too

Individual 401k plans also allow you to make Roth contributions during the calendar year, but Roth contributions are not valid for the previous year if made post December 31st. In case of an emergency, your 401k enables a loan option that allows you to access half of your money up to $50,000 penalty-free, and you pay it back to yourself over time. For a summary of a Solo 401(k) plan benefits, just visit our Solo 401k product page.

Paying yourself first with a Solo 401k is a great way to receive a gift that can keep on giving for years to come.

Happy Saving This Holiday Season!

Meet the Author

Our low-cost 401k plans are easy to setup online and are supported by our 401k advisors and specialists. ShareBuilder 401k serves small business and medium-sized companies, as well as the self-employed. We offer Roth 401k, Safe Harbor 401k, Traditional 401k, and Solo 401k options. Your 401k plan is paired with investment management expertise and employee education to help you save more.